Economists expect 50 basis point OCR cut
The markets have also moved to price in a reduction in the OCR, by a lesser amount of 25 basis points. However, BNZ, ASB and ANZ expect the OCR to remain on hold till late this year or early 2012.
ASB economist Jane Turner says the personal, economic and financial ramifications for the entire economy from the February 22 earthquake are becoming increasingly severe as more information comes to hand.
"At a time of national crisis, when the underlying economy is already proving frustratingly weak, a rate cut would potentially be very helpful to the recovery of the economy."
Turner says prior to the earthquake, the Reserve Bank had already flagged the possibility of an OCR decrease over this cycle if domestic conditions continued to deteriorate.
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